Accountants for Builders
Why do builders need different accountants?
The building industry is a tough one, and accountants know that. Recently, it has gotten even harder. Interest rates have gone up. Business owners can’t find workers. Good brickies are hard to come by. Material costs is rising through the roof. That is the best reason that builders need a good accountants that understand the business.
Focusing on building v/s focusing on accounting.
The activity itself is hard. Without having to worry about scheduling software, labour management, job costing. Then builders have to worry about their cash flow, margins being eroded, finding dedicated apprentices and managing subbies. Things get hectic and builders have to prioritise activities that put money on the table. One of the first to fall off is their bookkeeping and accounting. That is why builders that don’t give this task to professionals to do, fall behind and start copping fines. In fact it is really easy to fall behind admin and bookkeeping tasks too.
How accountants help builders
Between completing their BAS, TPAR, GST, PAYG, Super and so many more compliance tasks, things can get very disorganised. As a result, builders pay too much taxes. Fines mount up, audits come about and find all sorts of disasters in the books. This results in even more fines for non-compliance. Plus there are interest charges on short payments on their taxes.
Accountant for all stages of the build.
From initial quotes, planning, to lock up and sale, here at My Tax Guy, we got your back. Our accountants have worked with the smallest sole trader builders to the largest corporate builders in the country. Our accountants are good at finding extra cost savings, putting more money in the builders’ pockets. Combined with all the savings our clients get from being more compliant, our clients are thriving and not just surviving.
Compliance excellence for builders
It is not just BAS and Income Tax, that we help with. Not just PAYG, GST, super or TPAR compliance. We also help with cash flow management, ensuring there is extra around for that extra subbie to get the job done on time. We’ll help with invoicing, preparing quotes and tenders & finding the right software to make life easier for our clients in the construction industry. We’ve worked with builders, carpenters, plumbers and the best sparkies in the business. In fact we started in construction back in 2006. So you don’t only get tax and accounting knowledge, but you get quite a few years of experience here.
What sort of accounting?
This varies from builder to builder. For instance, if you are a startup, we can advise on what sort of cheap software will get the job done. And what sort of mistakes to avoid with money. Or even where not to spend money on marketing. Or what sort of structure you need for your budding company. If you start employing people, we can point you in the right direction with payroll and workcover. How about your superannuation requirements? Penalties are significant for getting this wrong. If you are getting larger and you are looking for external funding and need a business plan – or a marketing plan, we can help. Or if you are a large building company, we can manage your WIP and profit take up.
How To Start A Building Business?
Not many accountants focus on builders and specialise on this industry. Even fewer are experts at startups. That is because most experienced accountants prefer customers with more established processes and deeper pockets. However, we started from the ground up too. We know how it feels. As a result we have a developed a specific branch to support startups. In fact, we are known for that.
Accounting issues for startup builders:
Whether you want to merge with an existing business – or you want to go into business as a builder by yourself, it is complicated. You need to start off with the right structure, look after a myriad of tax and business registrations. How about business insurance? Accounting software? How about finance? With most issues you will come across as a startup, we can either help you out – or point you to the right people. After all, you don’t know what you don’t know.
A builder with the right accountant
Just like houses, businesses need a solid base too. You have to get the basics right. Basics can involve getting started with the right tax structure. And not having to move from software to software i.e. this is a decision you really want to get right, the first time. It is hard to do that when you are starting out. For instance, with the wrong business structure, you are actually setting yourself up to fail, even from day one. Should you go at it as a sole trader? A trust, a company, a corporate trustee, unit trusts? Partnerships? It can be a veritable maze to navigate to even just avoid horrendous capital gains. Not to mention other taxes that simply obliterate the margin on jobs.
Building issues versus Accounting issues
Here are a few dimensions to your budding set up problems:
- Some structures minimise tax more than others
- Other structures can do all that – plus asset protection
- How do you add investors to the mix?
- What legal facets need to be considered even on day 1?
- The changing risk profile of this industry
- Capital gains and tax concessions
- Margin Scheme eligibility.
Without compromising – there are only a few ways to get all this right from the get go. And yet, you cannot trifle with any of these conditions. Obviously, there are non-financial issues in any business. You may some more resources here.
Accountants using software for builders?
Some software can make life easier as a builder. Others are veritable nightmares to use. Your fellow builder usually outsources all that work and cannot tell you which is which. That is where we come in. That is because we know which one can integrate with your specific activities. Which ones will make it easier to get information for your tax returns so we minimise our own fees too. After all if we don’t reduce ALL your costs, we are not doing our job either.
Is there anything better than Xero?
Many amateurish accountants will just recommend Xero. In fact they don’t know any better. We are not knocking Xero. We are certified partners too. But there is other software for the building industry that may be more appropriate for what you are trying to achieve. There is no point to start on Xero, only to go through a very painful migration a few months later. For instance, many prefer Jobpac to Xero. Other software allow you to integrate estimating with your accounting software and cash flow management tools.
**As a builder you will value cloud computing more than other professions. That is because you can access a range of information about a particular project on site. Also, data is now live and backed up on the cloud, offering even more flexibilities.
How specialised are we?
Many accountants claim to specialise for builders – but they really don’t. Smaller businesses develop a range of tools. However, this is done in a silo. As a result they are not usually aware of the tools that the bigger end of town is using. The glass is half full, so, we see this as an opportunity to bridge that gap.
We have a developed a framework that integrates 4-5 facets of what the more-technologically-advanced competitors are using. That is just a fancy way of saying that we can show you what they are using to get better margins on their jobs. More importantly, we can show you how to use it too, and benefit from all the research they have done.
What does that look like?
All the plans in the world eventually boil down to action items and checklists. Let’s face it. That is likely the only way to avoid unnecessary risks, right? So, we have checklists for anything ranging from compliance to marketing – customised for builders.
If you would like to know what is likely to get audited, we can give you a list of the hot areas. Would you like to know what sort of marketing is currently working in the industry? Of course you do – well, again, we have you covered. And much more.
Compliance is more important than most builders think.
More builders and accountants understand that compliance is not to be trifled with. And that, getting this wrong results in very unpleasant fines, at best. At worst, the ATO bankrupts business owners. That is not the only reason you want to nail compliance though.
Being compliant opens doors. Big doors. Want to talk to people that will lend you money privately? They will want to know that you have a spotless record. Even if you want to talk private lenders you already know. They will still need spotless financials, among other things. We see this as an opportunity as compliance opens doors.
More accounting upgrades for builders
Actually, we can do more than that. As we often refer customers to the same lenders, we tend to get better treatment and we are quite demanding on that topic. This benefits our customers on a variety of fronts. Our customers pay our bills. It only makes sense that our builders thrive. And we will do everything to ensure that happens.
Allow me to introduce to something that makes us quite unique – for builders.
Marketing for builders.
The building industry is very different from others, when it comes to marketing. How would we know this? First of all, as accountants, we see successful builders and failing ones too. Marketing plays a key role in both.
Secondly, and most importantly, we also own a marketing agency & have implemented numerous marketing strategies in the building industry. In fact, we have done so since 1997 i.e. slightly before we started in accountancy. In 2007, we worked for the first in this industry.
What does that have to do with accountants and builders?
If an accountant doesn’t understand what a builder is doing to generate business, how can he/she help that business. To give adequate financial advice, the accountant must understand how much it cost to generate new business. Not just the costs of delivering the project. Control (And advice) has to be holistic.
There is no way to understand your world, without an in depth understanding of the key profit drivers in that ecosystem – with so many moving parts. How can we possibly advise you if we can give you a financial model that clearly advises on whether to go ahead with a project or not? Furthermore, industry accountants need not only know best practices, but they also need to know benchmarks.
Bookkeeping and accounting packages.
Like a few other accountants and bookkeepers out there, we have 3-4 levels or packages.
This is exclusively for the solopreneur. It involves minimal weekly rates depending on how many transactions. Alternatively, this package can accommodate for folks that want to do their own bookkeeping, and we only assist with the BAS and income tax returns and so on.
This is for more extablished businesses, that have decided to outsource their bookkeeping and accounting entirely. You simply don’t want to have to worry about compliance & managing staff that know more than you. This one comes with reporting for your projects and forecasting where necessary to avoid catastrophic cash flow issues.
Large builders that take on projects in the tens of millions of dollars. This takes multiple operators to deliver financials, end of month processes. Not to mention payroll and compliance. At this level, we recommend involving our virtual CFO.
This one, the business has its own accounting team. However, it cannot afford $300,000 to secure a full time CFO. We provide a virtual one. You see, if you strip some of the basic tasks a CFO does in a business, the real CFO stuff only takes a day/week. So, you can get the knowhow and financial management skills of a CFO in your business – for a fraction of the cost. Most builders don’t even know such a service exists.
Obviously, we can mix and match and come up with something that fits your unique business.
Either way, if you are after more information, reach out to us here.